Advertising takes another hit

Written by on January 12, 2016 in Opinion with 0 Comments

Beaten boxerWe have become slightly obsessed with the advertising world. We simply cannot understand how it is surviving. And, apparently, thriving. More and more people are watching television programmes on ‘catch up.’ More and more people (over 200 million and counting) are downloading ad-blocking software. Regulators are getting tougher on personal data and how advertisers and publishers can use it. In the US, the Regulator is cracking down on native advertising (a new word for advertorials) because publishers are not being strict enough when flagging up ‘sponsored’ content.

Then there is the menace of programmatic advertising, which the industry was touting as the engine that would deliver targeted, relevant and timely adverts. And which just increased the amount of spam – exponentially. Our suspicions about programmatic advertising have been confirmed as already beleaguered Yahoo has been caught out. Their programmatic advertising platform has been serving adverts from fake sites such as data centres. Some companies are saying that adverts are not running in between 30 and 70 percent of the places that Yahoo says they are.

Another bad day at the office.

So, the industry, its confidence dented by yet another blow to its credibility, sets off after another light at the end of the tunnel. Hoping that it is not a train rushing towards them.

They have just seen stats from a couple of research houses saying that the mobile web is not the place to advertise because users actually spend pretty much all of their time in applications. For instance, Jupiter Research estimates that in-app mobile ad spend will reach $16.9 billion by 2018, compared to $3.5 billion in 2013.

So, they are now thinking, we will chase our customers’ customers into said applications and nail them there (surely ‘serve them timely, relevant and compelling ads,’ Ed).

Once again the industry seems to be obsessed by chasing and annoying customers to the point of turning them off.

Whether there is an answer to this, we simply do not know. Whether the mobile advertising industry will actually reach 2018, let alone reach the $42 billion revenue predicted by BI Intelligence, only time – and not much of it – will tell.

What is truly astounding is that a) some of the largest companies on earth rely to a ridiculous degree on advertising revenue (even teeny Yahoo brought in $1.15 billion in its second quarter, a feat it is now very unlikely to do again) and b) they don’t seem to be doing much about it.

Oh, and c) how long before investors actually wake up and see the fragility of this business model?

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About the Author

About the Author: Alex was Founder and CEO of the Global Billing Association (GBA), a trade body focused on the communications sector. He is a sought after speaker and chairman at leading industry conferences, and is widely published in communications magazines around the world. Until it closed, he was Contributing Editor, OSS/BSS for Connected Planet. He is publisher of DisruptiveViews and previously BillingViews. .


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